Laboratory Corporation of America Holdings (LH)

Payables turnover

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020
Cost of revenue (ttm) US$ in thousands 9,384,500 9,163,300 8,991,300 8,888,300 8,796,700 11,053,100 10,828,100 10,617,100 11,096,100 9,308,900 10,005,400 10,600,800 10,496,600 10,400,400 10,060,000 9,492,400 9,025,700 8,573,500 8,348,000 8,396,600
Payables US$ in thousands 875,800 660,900 760,600 695,500 827,500 690,600 713,100 880,700 852,200 765,500 754,700 623,600 621,300 669,400 599,900 621,300 638,900 639,500 534,100 568,700
Payables turnover 10.72 13.86 11.82 12.78 10.63 16.01 15.18 12.06 13.02 12.16 13.26 17.00 16.89 15.54 16.77 15.28 14.13 13.41 15.63 14.76

December 31, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $9,384,500K ÷ $875,800K
= 10.72

The payables turnover ratio measures how efficiently a company is managing its accounts payable by comparing the amount of purchases made on credit to the average accounts payable outstanding during a period. For Laboratory Corporation of America Holdings, the payables turnover ratio has fluctuated over the periods provided:

- The ratio ranged from a low of 10.63 on December 31, 2023, to a high of 17.00 on March 31, 2022.
- The company's payables turnover generally increased from the end of 2023 to mid-2022, indicating that LabCorp was able to pay off its suppliers more frequently during this period.
- However, from June 30, 2022, to December 31, 2024, there was a decline in the payables turnover ratio, indicating a slowdown in the rate at which LabCorp was able to settle its accounts payable.
- It is worth noting the significant drop in the payables turnover ratio from 16.01 on September 30, 2023, to 10.63 on December 31, 2023, which may signify delays in payment to suppliers or changes in the company's payment terms.
- Despite the fluctuations, LabCorp has maintained a generally healthy payables turnover ratio, suggesting that the company has effectively managed its accounts payable overall.

In summary, while there have been fluctuations in Laboratory Corporation of America Holdings' payables turnover ratio, the company has shown efficiency in managing its accounts payable, although there were periods of slower payment to suppliers. Further analysis and comparison with industry benchmarks may provide additional insights into the company's financial management practices.


Peer comparison

Dec 31, 2024